Tag Archives: taxes

If you read the Mercer Island proposed budget for 2009-2010 (good times, I promise), you’ll see a 1% property tax increase planned in, as well as some other interesting nuggets. The Financial Forecast, page 14, is the best reading.

What were you expecting, a hockey dating controversy? Come on, it’s Mercer Island. Property tax increases are about as racy as we get.

Never thought you’d see a hockey photo in the Mercer Island Blog, did ya?

The 1% Property Tax Increase

Is the maximum increase allowed by Washington state under Initiative 747. The City’s been applying that every year since 2001.

According to the city, the small increase in property taxes isn’t enough keep up with the increase in expenditures. “Throughout the past ten years the cost of basic services has increased an average of 5% per year.” The trend in spending is worth digging into, maybe in a later post.

What About The Parks? They’re Net Zero on Tax

The parks levy passed on Nov. 4. The parks bond did not. The levy will increase property taxes on a $1 million home by about $114 per year, but that’s offset by two other levies that are being sunsetted. The offsetting levies total $113, so the net effect will be just about zero.

Mercer Island Property Taxes, On the Whole

Are not unreasonable, given the area. I’m not blindly against taxes. They fund a lot of good things- schools, police, and roads, among other nice things. But I keep an eye on them because we’ve got to look at spending increases critically, like any of us would own household budget. Ironically, the less critically we look at public expenditures, the more critically we need to look at private spending, because we’ve got less money.

If you want to comment, December 8th is when the budget ordinance is scheduled for voting. Contact your councilperson if you want to get something done, or comment here if just you want to gripe.

The Mercer Island property tax rate is of $7.16 per $1,000, or about 0.7% of property value. For a $500,000 house, that’s about $3,600 per year.

Our property tax is really 9 different kinds of property tax, with schools taxes the largest amount and city and county taxes following. In 2008, it breaks down like this:

Mercer Island’s rate is in the low range of King County property tax rates, in line with communities like Bellevue and Yarrow Point, according to the tax assessor. This is because cities with more expensive homes can get plenty of revenue with lower rates.

Tax Rates Down, Tax Bills Going Up

The good news is that Mercer Island’s rate has decreased over the last four years, from $8.6 per $1,000 of assessed value in 2005 to the current $7.16. Of course, house values in the Seattle area have increased 36% since January of 2005, according to the Case-Schiller index. This means your property tax bill has probably increased since 2005.

Breaking the different school rates into their major parts: school, city, county, library, and grab-bag (port, ferry, EMS, flood), we see that each type of property tax rate came down in 2007, except for the grab bag.

EMS saw a rate increase of about 50%. It’s hard to argue with EMS– I want ambulances to be as fast and well-trained as possible. Flood and ferry property tax rates are new in 2008, together contributing about $0.155 in tax per $1,000 of assessed value. For a $500,000 house, that’s $78 per year in additional taxes.

A ferry tax? There hasn’t been a ferry on Mercer Island since the Dawn, but maybe if I-90 gets tolled we can lobby for the Washington State Ferry system to get us a new one.

UPDATE: KOMO News published this story about Puget Sound mayors reacting to the financial crisis, saying:“The problem is simple, even on Mercer Island. Money from property taxes won’t keep pace with inflation. The total property tax can only increase one percent a year. Inflation is running at five times that.”